Event: The National Press and Publication Administration issued the Measures for the Administration of Online Games (Draft for Solicitation of Comments), which mentions that online games must not set inducing rewards such as daily login, first top-up, and continuous top-up, and all online games must set user top-up limits.
Hong Kong game stocks fell further in the afternoon, with Tencent falling more than 15% and NetEase falling more than 20%.
In the afternoon, a number of game media ETFs dived, game ETFs, game animation ETFs, and game ETFs hit the fall limit, and game media ETFs and entertainment media ETFs fell by more than 6%.
The market is generally cautious about the new rules for online games.
At present, it is still a draft for comments, but if it is implemented, it will have a big impact on game companies, which will actually affect profitability.
If this version is implemented, it will have a great impact on the game industry. Among them, the protection of minors, business units and the management of version numbers have not changed much compared with the previous regulatory model, but the supervision of game payment is stricter than expected, and the key impact provisions include:
(1) It is forbidden to set up forced battles (may be for forced PVP gameplay in MMO);
(2) Inducing rewards such as daily login, first recharge, and continuous recharge shall not be set (the current common payment mode will affect the player's willingness to pay), and the recharge limit must be set (the amount of the limit depends on the follow-up supervision and implementation, and the impact is relatively large);
(3) It is not allowed to provide services for exchanging game currency for fiat currency, and it is not allowed to operate game currency issuance and trading services at the same time;
(4) The virtual props obtained by the user shall not be exchanged for fiat currency, and the exchange of small physical items must comply with laws and regulations (which has a great impact on the props trading platform of the game company);
(5) When providing random drawing services, the number of extractions and probabilities should be reasonably set, and other ways to obtain services with the same performance should be provided (this is relatively landed, and there has always been an expectation for the supervision of card drawing); At present, it is difficult to measure the impact of policy implementation on the revenue of game companies, and the implementation of many provisions is not clear, so it is necessary to pay attention to the recent feedback from the game industry, but it is true that the policy is stricter than expected.
At present, the supervision is still in the stage of the draft for comments, and it is expected that the follow-up supervision will also discuss with the industry for the consultation draft, and the final implementation may have room for relaxation.
In terms of the current regulatory environment, the regulator also emphasizes the encouragement of high-quality original games and games to go overseas. Therefore, short-term sentiment needs to be digested, but in the medium and long term, there are still development opportunities for China's game industry, and companies that do well in games going overseas will be relatively less negatively affected.
Some game companies have already responded.
Fuchun shares: On December 22, it said on the interactive platform that if the "Measures for the Administration of Online Games (Draft for Solicitation of Comments)" is implemented, it will have little impact on the company's existing operating game products. In 2022, overseas revenue accounted for 88.59% of the company's game revenue.
Hengxin Oriental: On December 22, it said on the interactive platform that the company's business does not involve online game publishing business activities related to the "Measures for the Administration of Online Games (Draft for Solicitation of Comments)", and game supervision has no impact on the company's performance.
Kaiying Network: At present, there is no substantial impact on the company's operation. Game top-up and advertising are the company's main revenues.
Yao Ji Technology: The company has just been informed of the new regulations on the management of online games, and if the draft is passed, it is estimated that it will have a great impact on the entire game sector and the industry. The draft is for the industry as a whole, not for individual companies, and the company should study the details and then follow up on relevant countermeasures.
Shenzhou Taiyue: It has had less impact on us. Our game business is mainly overseas, and the overseas revenue of games in 2022 has exceeded 85%. At the same time, the policy level also continues to encourage culture and games to go overseas. In addition, the draft has just come out, and we need to study and Xi understand it in depth, and we will actively participate in the discussion of relevant opinions. ”
Rock Mountain Technology: On December 22, it said on the interactive platform that the company's main business includes Internet information service business, artificial intelligence business and diversified investment business. Among them, the Internet information service business is mainly based on website promotion and marketing services, covering dozens of categories including finance, shopping, film and television, social networking, life, games, military, etc., and the revenue generated by game promotion and marketing services in 2022 accounts for less than 10% of the company's operating income. Other than that, the Company has no other game business and game products. To sum up, if the Measures for the Administration of Online Games (Draft for Solicitation of Comments) issued by the National Press and Publication Administration are implemented, the impact on the company will be small.
Sanqi Mutual Entertainment: At present, it has paid attention to the "Measures for the Administration of Online Games (Draft for Solicitation of Comments)" released on the website of the National Press and Publication Administration today, and the company is still studying the impact of the "Measures" on the company after it is implemented.
Attached is the ranking of Chinese game manufacturers' overseas revenue in November 2023.
Digital currency-related stocks:
Chuangzhi Technology, Chutianlong, Yuyin Shares, Qitian Technology, Hailian Jinhui, Xiongdi Technology, Jingbei, Sifang Jingchuang, etc
It is not intended as a securities recommendation or investment advice, it is intended to provide more information, and the author does not guarantee the accuracy of its content.